The Independent Pricing and Regulatory Tribunal in NSW (responsible for the economic regulation of the NSW energy market) has recently released a Draft Decision (1 May 2017) to change the feed-in tariff (FiT) price for exported electricity from solar photovoltaic systems set in that state.
In somewhat of a significant move, IPART is intending to increase the recommended FiT rate from 5.5c to 7.2c/kWh in 2016-17 to 11.6c to 14.6c/kWh in 2017-18 – roughly a doubling in the price paid to solar owners.
The recommended FiT range has increased substantially due mainly to higher forecast wholesale electricity prices in 2017-18.
The draft methodology estimates the value that electricity retailers receive when solar customers export electricity to the grid from their small-scale solar unit. The three components that make up this value include:
• the amount that exported solar electricity would earn if it were sold on the wholesale electricity market at the time it was exported (retailers avoid paying for this);
• an amount to reflect the benefit of exported electricity being located close to where it is used (normally electricity is generated away from where it is used, and some of the electricity is lost as it flows over the transmission and distribution network); and
• an amount for the market fees and charges that retailers avoid paying for on exported electricity.
IPART’s is a recommended range that electricity retailers should pay to solar owners. Unlike other states, it is not a mandatory minimum set by legislation. As such, electricity retailers can choose to ignore the recommendation – however many in NSW do continue to offer FiTs within IAPRT’s recommended range.
For details on what FiT prices (and normal tariff prices) NSW retailers offer, go to: https://www.energymadeeasy.gov.au
IPART are currently seeking comment on their Draft Decision (until 29 May) and are set to release their Final Decision in June.
More information is available at: https://www.ipart.nsw.gov.au/files/sharedassets/website/shared-files/pricing-reviews-energy-services-publications-review-of-solar-feed-in-tariffs-201718/fact-sheet-review-of-solar-feed-in-tariffs-2017-18-may-2017.pdf